Discussions happening on both sides of the political divide have made understanding the Affordable Care Act murky for many small business owners. What are the plain facts? How will the ACA affect business, employment, and your taxes?
Four Ways the Affordable Care Act
will Impact Your Organization
- Providing a notice of coverage.
Any business with more than 50 employees was required to provide notification to their employees regarding health insurance coverage starting in late 2013. This notice needs to be given to employees regardless of whether the employer is going to be offering insurance coverage or not. It needs to be communicated in writing so it can be understood by everyone working for your organization. The Department of Labor can offer more assistance regarding this documentation.
- Small business tax credit. Small businesses became eligible for a tax credit concerning healthcare coverage starting in 2010. This credit is intended to offset some of the healthcare costs that have risen due to the ACA. The credit, for employers with fewer than 25 employees, is on a sliding scale based on employee income. Businesses were able to receive up to 35% of their contribution to the employees’ insurance. This year the maximum credit was raised to 50%.
- New W2 reporting on health care costs. The Affordable Care Act also changed the way healthcare costs are reported on the employee W2s. Now employees are required to show the value of the employer contribution of their healthcare costs. This report is intended to be for informational purposes so employees can better understand the costs of their insurance coverage. Some companies are exempt from this. The IRS can provide more information.
- Understanding the employer mandate delay. The mandate that employers with over 50 employees must provide insurance by January 1st, 2014 was extended to 2015. Employers who do not provide the option will need to pay a penalty. The delay means that employers have the remainder of 2014 to figure out the options afforded to them based on the ACA.
If your hiring in 2014 the Affordable Care Act is just one issue to look into. At Full Steam Staffing, we have the knowledgeable recruiters on hand to assist you in your hiring needs. Contact our team of recruiters, proudly serving Stockton California, today for more information.